Overview of trading and tips on USD/JPY
The price test of 157.58 at the beginning of the US session occurred at a time when the MACD indicator was just starting to move up from the zero mark, which confirmed the entry point to buy the dollar in continuation of the uptrend. As a result, the pair rose by more than 50 pips. The US inflation data triggered dollar buying and yen was being sold at the end of last week, leading to another yearly high above 159. This, as you can see, prompted intervention by the Bank of Japan, resulting in a major sell-off in the market.
The central bank has not made a comment regarding the intervention. Japan's chief currency policymaker declined to comment. When asked if Tokyo intervened in the currency market after a sharp move that lowered the dollar-yen exchange rate by 2%, the response was: "No comments for now." Masato Kanda said that he currently has no plans to comment on what happened, although it is quite clear what happened. Today, the market will maintain high volatility, so there will be opportunities to make profit. As for the intraday strategy, I will rely more on the implementation of scenarios No. 1.
Buy signals
Scenario No. 1. I plan to buy USD/JPY today when the price reaches the entry point around 157.25 plotted by the green line on the chart, aiming for growth to 158.09 plotted by the thicker green line on the chart. In the area of 158.09, I'm going to exit long positions and open short ones in the opposite direction, expecting a movement of 30-35 pips in the opposite direction from that level. You can count on USD/JPY's growth today as traders will be interested in buying undervalued assets. Before buying, make sure that the MACD indicator is above the zero mark and is just starting to rise from it.
Scenario No. 2. I also plan to buy USD/JPY today in case of two consecutive tests of 156.79 at the time when the MACD indicator is in the oversold area. This will limit the downward potential of the pair and lead to an upward reversal of the market. We can expect growth to the opposite levels of 157.25 and 158.09.
Sell signals
Scenario No. 1. I plan to sell USD/JPY today only after testing the level of 156.79 plotted by the red line on the chart, which will lead to a rapid decline in the price. The key target for sellers will be 156.04, where I am going to exit short positions and also immediately open long ones in the opposite direction, expecting a movement of 20-25 pips in the opposite direction from that level. Pressure on USD/JPY may return after an unsuccessful breakout of the daily high and active actions by the central bank. Before selling, make sure that the MACD indicator is below the zero mark and is just starting to decline from it.
Scenario No. 2. I also plan to sell USD/JPY today in case of two consecutive tests of the price of 157.25 at the time when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downwards market reversal. We can expect a decline to the opposite levels of 156.79 and 156.04.
What's on the chart:
The thin green line is the entry price at which you can buy the trading instrument.
The thick green line is the price where you can set Take-Profit (TP) or manually fix profits, as further growth above this level is unlikely.
The thin red line is the entry price at which you can sell the trading instrument.
The thick red line is the price where you can set Take-Profit (TP) or manually fix profits, as further decline below this level is unlikely.
MACD line: it is important to be guided by overbought and oversold areas when entering the market
Important: Novice traders in the cryptocurrency market need to be very cautious when making decisions to enter the market. It is best to stay out of the market before important fundamental reports are released to avoid getting caught in sharp price fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. Without setting stop orders, you can quickly lose your entire deposit, especially if you don't use money management and trade with large volumes.
Remember, for successful trading, it is necessary to have a clear trading plan, similar to the one I presented above. Spontaneously making trading decisions based on the current market situation is inherently a losing strategy for an intraday trader.
